Sam Taylor’s goal as CEO of novelties retailer Oriental Trading Company is to build a global brand with an online strategy.
By Mary Wagner
At Hewlett-Packard Co., where Sam Taylor oversaw HP.com and the computer manufacturer’s global direct-to-consumer business, his stock in trade was some of the most advanced home and home office digital equipment on the market. At Oriental Trading Co., where he signed on as chief executive officer May 5, Taylor heads a company where some of the best-selling merchandise includes raffia hula skirts for luau parties at $4.49 and rolls of make-your-own-funny face stickers for just under $6.
That may seem like a disconnect. But in a working life that has spanned continents and planted him in locales as disparate as Paris and Minneapolis, Taylor’s career path has been guided by a couple of constants. Under this approach, it makes the same sense to move from $100 billion Hewlett Packard in San Diego to $600 million Oriental Trading in Omaha, Neb., as it did to leave a gig with The Walt Disney Co. in Paris for life at Lands’ End in Dodgeville, Wis. Here’s one of the constants: He looks for opportunities with the leading brands in their category. Here’s another: It’s not just the size of the company but its culture that matters.
“Some people are product-focused; Sam is customer-focused,” offers Bill Bass, now CEO of online retailer Fair Indigo, with whom Taylor worked at Lands’ End earlier in their careers. “If you are building a good customer experience, every customer appreciates that, no matter what the product.”
Though he’s devoted the last several years of his career to e-commerce, Internet retailing wasn’t yet on the horizon when the California native landed at Exxon in 1985 after graduating from Brigham Young University with a degree in chemical engineering. But a year in the field was enough to signal that business, not engineering, was where his true interests lay.
Taylor approached Bain Consulting, where he’d interviewed as an undergraduate, seeking a training ground to learn about business operations and to prepare for business school. Joining the firm as an associate consultant, he got all that and more.
On one of his first assignments, he viewed customer focus groups reacting to new product ideas from a Bain client, a consumer product company. “I’d never seen customers talking about their ideas like that. I was hooked,” he recalls. The importance of listening to and understanding the customer was a key concept he would carry forward.
Two other practices at Bain generated two other takeaways that figured into his subsequent career choices. The firm’s retail practice was his first exposure to the category. Later, in the firm’s customer retention practice, he learned how not just meeting customers’ needs and expectations but exceeding them could drive loyalty, which in turn led to customer retention and business results.
After nine years with Bain, including two at Harvard University business school, an executive recruiter called with an opportunity that not only met his criteria for working with a market-leading firm, but fulfilled a secret wish held by many a Southern California kid: to work for the Big Mouse.
Taylor joined The Walt Disney Co. as director of strategic planning and business development for its consumer product division, including Disney’s U.S. catalog business. When the opportunity arose three years later to run Disney’s catalog business in Europe, he jumped at it, relocating to Paris to take the job and at the same time packing an agenda of his own.
“It was 1998, and really, my eye was on the Disney Store online,” he says. The launch of Amazon.com three years earlier had convinced him that the Internet would redefine retail. “I knew it was going to be the next big thing and I wanted to be a part of it,” he says.
A fateful lunch
With the European catalog business squared away, Taylor turned his energies toward developing a business plan for a European Disney e-commerce site to complement one Disney had launched at home. Disney, however, had other Internet priorities. Its struggling Go.com portal, launched in 1999, was intended to be a general portal, but facing stiff competition from incumbents like Yahoo, Disney was trying to recast it as an entertainment-specific Internet gateway.
“I understood that the focus was on trying to improve Go.com in the U.S.,” Taylor says. “But it was a little frustrating because there wasn’t the focus on Europe.” Disney closed Go.com in 2001.
Frustration and opportunity crossed paths at a Forrester Research conference in Amsterdam, where Taylor shared a table with Bass, then senior vice president of e-commerce at Lands’ End, which was independent then but is now part of Sears Holdings Corp. A week after a lengthy post-lunch conversation, Taylor boarded a plane for Lands’ End headquarters in Dodgeville, later accepting a position with the company as vice president of international.
With his sights originally on an e-commerce role, that title wasn’t his first choice, but at the time, Lands’ End was losing money on its subsidiaries in Germany, the United Kingdom and Japan, and it wanted to tap Taylor’s international catalog experience. That meant he’d have to initially reduce the role he’d hoped to play with the Internet and increase his responsibilities in the catalog arena.
Taylor had become vice president of e-commerce when Best Buy Co. Inc. recruited him to BestBuy.com in 2004. As senior vice president of online stores and marketing, he found at Best Buy the chance to gain experience with a bricks-and-mortar retail organization.
A bigger stage
Best Buy’s online business was growing when the Hewlett-Packard Co. called in 2006. It was an opportunity to play on an even bigger global stage. HP’s Internet business at that time had already topped $1 billion. And as senior vice president of HP.com and HP consumer direct, Taylor would be in charge of web sites in 70 countries, representing 35 languages. “I couldn’t say no to that type of opportunity,” he says,
But when HP reorganized in 2007 after he’d been with the company 18 months, Taylor decided to take stock of his career. He realized that in a working life that followed bigger and bigger publicly-traded brands, he’d never worked for a private firm, an environment that would allow him to look beyond the demands of quarterly financials to do more long-range planning. Having set the parameters of a more entrepreneurial organization backed by private equity, where he would have the opportunity to be chief executive officer, he was receptive when a recruiter called on behalf of Oriental Trading Co. a few months later.
“The first thing I did when I got off the phone with the recruiter was to ask my wife what she knew about Oriental Trading,” Taylor recalls. “She started pulling out catalogs she had received from Oriental Trading and raving about the company.”
As the mother of three school-age children, she considered Oriental Trading a go-to source for party, arts and crafts, and school supplies. Asking around, Taylor found that other local moms and teachers held a similar view, as did moms, teachers and others across the country who need such supplies at a value price. 75-year-old Oriental Trading in fact dominates its space as the largest direct marketer of party supplies, novelties, and arts and crafts items.
With a customer base that loyal, Taylor could apply everything he’d learned and come to believe in about acquiring and keeping customers in every other retail job he’d ever held. And with some 50% of Oriental Trading’s $600 million business already web-based, Taylor saw that the time was right to leverage that loyal base online with new technology and marketing programs.
“I saw the opportunity to transform Oriental Trading from a traditional cataloger to a company that is truly driven by the Internet,” he says. While catalogs will remain an important part of the mix, “Our goal is to make Oriental Trading the online destination for our product categories in all of our customer segments, from both an e-commerce perspective and an online community perspective,” he says. “We are really going to focus on improving the customer experience.”
Creating community
As to what form that will take at OrientalTrading.com, Taylor is keeping specifics under wraps for now, though the site recently rolled out a promotion that offers a hint. “Make the world more fun” is aimed at gathering user-generated content. It was developed prior to Taylor’s arrival May 5, but he gives it a thumbs-up as the kind of initiative the company will do more of.
“It’s our strongest foray into user-generated content and beginning to build an online community,” he says. “Between now and the end of the year, you’ll see enhancements to the online community aspects of our site.”
Taylor aims to more than double Oriental Trading’s business over the next several years by growing its share of the categories in which it plays and expanding into new product categories. He’s also out to grow international business, building on a small but growing foothold in Canada. “I see no reason we should not be able to make Oriental Trading into a global brand,” he says.
Such big visions face obstacles in a shaky economy—a situation not unique to Oriental Trading. “Private equity-backed companies like Oriental Trading take a longer term view than the stock market as a general rule,” Bass says. “The issue with private equity companies as you go into a turbulent market is that it’s a lot of work to keep the company cranking along. It’s not the short-term focus you have to worry about, it’s the long-term health of the business.”
But Taylor has a plan for that, based in part, he says, on what he learned at Lands’ End from founder Gary Comer, but tweaked with what he’s discovered on his own over the years.
“Number one, we’ll take care of our employees. Number two, we’ll let our employees take care of our customers. Number three, we’ll let our customers take care of spreading the word—and then everything else will take care of itself,” he says. “If you have engaged employees and loyal customers, the business results will follow.”
mary@verticalwebmedia.com
